On June 1, 2020, the Department of Justice (DOJ) Criminal Division released an update to its “Evaluation of Corporate Compliance Programs” guidance for federal prosecutors, its first change since April 2019. Although the update did not fundamentally alter the guidance’s structure, the revisions directly impact how companies should assess and monitor their compliance programs.
These changes, though, could be further changed due to the 2020 election and President Joe Biden taking office. While changes that emphasize corporate compliance will likely remain unchanged, it’s very likely the new administration will be significantly harsher than the old one.
What could this mean for your business? Check out this article for our thoughts on what compliance changes may happen during this new administration.
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Why It Matters To You
As a business owner/leader, you should always be keenly aware when you may be investigated for noncompliance.
You and your team should note any changes to these compliance structures to ensure you won’t face a lengthy investigation from the federal and/or state government, especially if you’re unknowingly committing an act of fraud.
Knowing what the regulations currently are, as stated above, helps us to inform what we think things will look like in the coming months and years, allowing you to be prepared for any changes that may come up.
Prosecuting Corporations
The revisions made in 2020 boil down to being more big-business friendly than the Obama administration’s approach to DOJ cases. While Obama was president, the prosecutions were targeted against global financial institutions. They could rack up hefty fines if found to be non-compliant.
One thing that changed under the Trump administration was that investigators couldn’t “pile on” violations. This meant that if multiple agencies were imposing fines onto a company for an issue, they had to do so in a way that wouldn’t cause undue burden onto the company. You couldn’t be fined for the same thing by multiple agencies under the Trump administration.
It seems incredibly likely that multiagency and multinational investigations will be permitted to impose multiple fines for violations as they were allowed to pre-Trump. This could mean that if your business makes a severe mistake and is investigated by various agencies, you might face significant fines.
Will Self Reporting Save You?
In 2017 it was made clear that any corporation that voluntarily self-reported violations and fully cooperated on time would receive significant incentives for doing so. One of those incentives was the ability to waive 50% of the fine if a company self-reported a violation and cooperated.
Under the Biden administration, we can guess that the likelihood that you’ll see the current 50% reduction in fines for self-reporting is slim to none. While there may still be incentives to self-report, we guess there will be more aggressive enforcement against companies who violate the policy rather than giving leeway when it comes to noncompliance.
What About Pandemic Fraud?
All pandemic-related statutes were passed under the Trump administration, and fraud related to the pandemic was one of the most considerable criminal penalties that the DOJ could assess. Think about things like the CARES Act or the Paycheck Protection Program- these are costly federal incentives that the federal government doesn’t want taken advantage of.
This means that, especially with the third round of stimulus checks and COVID-19 relief, it’s likely that program enforcement surrounding COVID-19 fraud will only get harsher.
Are You Struggling?
If you and your business are struggling to understand all of the compliance rules and regulations, you aren’t alone. Navigating these waters is a tricky task, but there are people in your corner you can trust to help you and your business prevent costly investigations.
At Bench Builders, we offer coaching for you as a business owner/leader to ensure you and your management team are fully aware of all laws, regulations, and compliance expectations. We can even sit down with you for your first session for free by reaching out to us here.
Whether you’re struggling to ensure everything you’re doing as a business is within compliance rules, or you simply want to organize a review session with your management, we at Bench Builders can help you have the tools you need to succeed, regardless of the new policies that inadvertently come with a new United States president.
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